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The automated Quantcha Trade Ideas Service has detected a promising Bull Put Spread trade opportunity for DELTA AIR LINES (DAL) for the 15-Dec-2017 expiration period. You can analyze the opportunity in depth over at the Quantcha Options Search Engine.

DAL was recently trading at $54.94 and has an implied volatility of 25.23% for this period. Based on an analysis of the options available for DAL expiring on 15-Dec-2017, there is a 35.42% likelihood that the underlying will close within the analyzed range of $55.73-.12 at expiration. In this scenario, the average linear return for the trade would be 80.33%.

Price target: Zacks Research has updated their six-month price target for DAL to $61.92. This price target is a consensus price created from the price targets published by 13 participating analysts whose targets ranged from $50.00 to $75.00.

Mean recommendation: Zacks normalizes analyst recommendations to a 1-5 scale where 1 indicates a strong buy. Their mean recommendation for DAL has been updated to 1.27, which indicates a strong buy consensus from analysts. Sentiment has moved from 1.32 to 1.29 to 1.29 over the past three months.

Trade approach: The difference between the current price for DAL and the mean price target is $6.07, which represents a 12.72% move (27.48% annualized). Since the 180-day implied volatility for DAL is 27.09%, a bullish strategy could prove effective if the price target ultimately turns out to be accurate.

Upside potential: Using this bullish strategy, the trade would be profitable if DELTA AIR LINES closed at or above $55.00 on 15-Dec-2017. Based on our analysis, there is a 50.02% likelihood of this return.

Downside risk: As with any options trade, there is a substantial downside risk where you may lose most or all of your investment.